The north of England needs to find its own, new way of delivering public services, according to a think-tank report which finds Government regional policy wanting and a gaping hole left by the 'rushed' abolition of regional development agencies.

The Smith Institute and accountants PricewaterhouseCooper call for a forum provisionally named Public Services North which would harness the energy of business, local authorities, universities and the voluntary sector to pioneer changes regardless of Whitehall.

Determined to avoid 'chippiness', in spite of setting out in detail the inequity of local government finance and the way that current cuts damage poorer northern councils more than wealthy south-eastern ones, the report highlights existing examples of 'northern best practice' as beacons.

These include the takeover of 13,700 council houses in Rochdale by a social housing trust with six elected tenants on its 13-strong board and the Kielder Partnership of all the sectors in Northumbria whose plans include possible free provision of land to developers of affordable housing. Other innovators praised are the Altogether Better initiative in Cheshire West and Chester which involves more than 150 local groups in setting budgets and the closely integrated 'anticipatory care' provision which Stockport council and the NHS trialled in Marple before rolling-out generally.

The report shows graphically how lower property values in much – although by no means all – of the north skew the collection of local finance, with more required from lower council tax band properties whose owners then suffer more from public spending cuts. It piles up more evidence to back the conclusion of the Economist last September that:

Under the formulae used to determine local Government funding, cuts to council budgets are deeper in poorer places, which includes most local authorities in the north.

Attempts to counter the imbalance are acknowledged, especially the City Deals offered to centres such as Manchester and Leeds whose ability to use their clout is reckoned to be "the main beacon of hope" as the country bumps along the bottom of prolonged recession. But the report argues that the Government's Local Enterprise Partnerships are a poor substitute for the abolished North West Regional Development Agency, Yorkshire Forward and One North East whose whole credo was to help the three northern regions to prosper generally, rather than in hotspots.

It looks instead at the progress of 'combined authorities' which is being pioneered by Greater Manchester and praises the related work of the Core Cities movement which involves eight 'city regions' in the UK including all the main northern centres. It says:

Alongside these initiatives, the north needs to act now on the future shape of public services. Service providers in the north of England cannot wait for a new model for services to emerge (or to be imposed) from Whitehall, or from political parties. What is needed now is for local authorities and health providers to give a lead, building a consensus across civil society – working with community and voluntary organisations, faith groups, businesses and trade unions, universities and colleges and housing associations – on the future shape and delivery of public services.

Now imagine a red and white rose emblazoned on the scarlet and gold of the north east

The report follows a similar study by the Institute and PwC last year which suggested a Council of the North, an institution which last flourished in the days of King Richard III whose rediscovered body may in due course be returned to York for burial. It also nods to a revival of northern regionalism in the shape of groups such as the Hannah Mitchell Foundation, and significantly looks further north by citing the past work of the Scottish Constitutional Convention, a spur to Scotland's growing self-government as

A grouping outside government and the formal political structure, but commanding broad support as a means of building a new consensus.